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Edith Mitchell, accompanied by her thirteen-year-old daughter, went through the checkout at Wal-Mart and purchased several items. As they exited, the Mitchells passed through an electronic antitheft device, which sounded an alarm. Robert Canady employed by Wal-Mart as a “people greeter” and security guard, forcibly stopped Edith Mitchell at the exit, grabbed her bag, and told her to step back inside. The security guard never touched Edith or her daughter and never threatened to touch either of them. Nevertheless, Edith Mitchell described the security guard’s actions in her affidavit as “gruff, loud, rude behaviour.” The security guard removed every item Mitchell had just purchased and ran it through the security gate. One of the items still had a security code unit on it, which an employee admitted could have been overlooked by the cashier. When the security guard finished examining the contents of Mitchell’s bag, he put it on the checkout counter. This examination of her bag took ten or fifteen minutes. Once her bag had been checked, no employee of Wal-Mart ever told Mitchell she could not leave. Mitchell was never threatened with arrest. Mitchell brought a tort action against Wal-Mart.

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Statistic Netherlands states that 84% of all Dutch households have a microwave. In addition, 47% of all Dutch households have a dishwasher. Suppose 13% of all Dutch households have both a microwave and dishwasher. A Dutch household is randomly selected.

a. What is the probability that the household has a microwave or a dishwasher?

b. What is the probability that the household has neither a microwave nor a dishwasher?

c. What is the probability that the household does not have a microwave and does have a dishwasher?

d. What is the probability that the household does have a microwave and does not have a dishwasher?

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Elapsed Time to Earn a Bachelor’s Degree Clifford Adelman, a researcher with the Department of Education, followed a cohort of students who graduated from high school in 1992, monitoring the progress the students made toward completing a bachelor’s degree. One aspect of his research was to compare students who first attended a community college to those who immediately attended and remained at a four-year institution. The sample standard deviation time to complete a bachelor’s degree of the 268 students who transferred to a four-year school after attending community college was 1.162. The sample standard deviation time to complete a bachelor’s degree of the 1145 students who immediately attended and remained at a four-year institution was 1.015. Assuming the time to earn a bachelor’s degree is normally distributed, does the evidence suggest the standard deviation time to earn a bachelor’s degree is different between the two groups? Use the  level of significance.

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The Book Wermz reported sales for 2005 of 6,230,000. Cost of goods sold was 55% of sales, and operating expenses were 2,155,000. Interest expense was 190,000. Income taxes were 35% of pretax income. Total assets at the end of 2005 were 5,623,000.

Required Use the information provided to produce an income statement for The Book Wermz for the year ended December 31, 2005. Enter appropriate captions for the statement at the top of the spreadsheet and appropriate captions in column A. Enter amounts in column B. Use equations to calculate subtotals and totals. Calculate cost of goods sold as sales  0.55 and income taxes as pretax income  0.35. Following the income statement, enter the total assets data and calculate asset turnover, profit margin, and return on assets. Enter captions in column A and calculations in column B. Use cell references to the income statement and total assets in these calculations. Suppose that the company’s management believes that it can increase sales by reducing product prices. Cutting the prices relative to the costs of the goods sold would increase the ratio to 60%, but is expected to increase total sales to $7 million. Operating expenses and interest expense are relatively fixed and would not be affected by these changes. Total assets also would not be affected. In column C calculate the effects of the changes on the company’s income statement and financial ratios. Copy the data from column B to column C and make changes as needed. Would the pricing change be advantageous to the company? Another alternative for the company is to raise prices relative to cost of goods sold and significantly increase advertising. The increase in prices would reduce cost of goods sold to 50% of sales. The additional advertising expenses would increase operating expenses to $3 million. Total sales are expected to increase to $7.5 million. Interest expense and total assets would not be affected by these changes. In column D calculate the effects of the changes on income and the financial ratios. Would the company benefit from these changes?

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